Apollo to buy Verizon media assets, including Yahoo


U.S. private equity group Apollo Global Management is set to acquire Yahoo and other media assets from Verizon Communications, people familiar with the situation said, as the telecommunications group focuses on its network business. base and deployment of 5G wireless technology.

The envisaged deal, in which Apollo would pay between $ 4 billion and $ 5 billion for assets, could be announced as early as Monday, the people added.

This would mark a dramatic about-face for the US wireless operator, which between 2015 and 2017 spent around $ 9 billion to acquire Yahoo and AOL as flagship properties of an online media division that became known as the oath.

The strategy reflected a mindset that was once widely shared by the world’s largest telecommunications companies, which sought to profit from the explosion in digital media consumption by becoming content owners rather than mere network operators, or “stupid tips”.

Netflix and Amazon have built huge online media businesses to meet consumer demand for video on demand, while media companies such as Disney and ViacomCBS have rushed to adapt their businesses to changing consumer habits. consumers creation of streaming platforms of their own.

But telecommunications companies have generally struggled to establish themselves as creators and owners of the programming distributed over their cellular networks and wires.

Verizon’s struggles are not unique. Its biggest rival AT&T acquired Time Warner, owner of CNN, HBO and Warner Brothers, for $ 85.4 billion about five years ago to build a streaming business capable of taking on Netflix.

The strategy has so far had mixed success. AT&T took a $ 15.5 billion charge on its pay-TV business in January, as customers switch to streaming platforms from cable and satellite.

Verizon also hoped to create a content and marketing platform that would allow it to compete with Google and Facebook. However, it failed to gain significant market share from its rivals, forcing it to reconsider the broader strategy, said a person with direct knowledge of the matter.

The sale of media assets further underscores Verizon’s decision to double the expansion of its 5G internet services, which covered 230 million people in more than 2,700 cities as of December last year.

Verizon suffered a $ 4.6 billion write-down on its media business in 2018, after the brands “suffered increased competitive and market pressures.” . . this resulted in lower than expected revenues and profits, ”the company said in a filing.

“These pressures were expected to continue and resulted in a loss of market positioning compared to our competitors in the digital advertising sector,” added the file.

Verizon also “achieved lower than expected profits through the integration of. . . Yahoo and AOL, ”he says.

The potential deal was first reported by The Wall Street Journal.



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